Official Assignee v Norris [2012] NZHC 1788 (20 July 2012)

Last Updated: 24 July 2012

IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY

CIV 2011-442-000080 [2012] NZHC 1788

BETWEEN THE OFFICIAL ASSIGNEE Plaintiff

AND PATRICK DEAN NORRIS Defendant

On the papers

Counsel: P Murray for the Plaintiff

Defendant in person

Judgment: 20 July 2012

JUDGMENT OF MALLON J (Costs)

[1] The Official Assignee brought proceedings against Mr Norris in respect of his actions as a liquidator of eight companies. In my judgment given on 8 May 2012 I set aside judgments of the Associate Judge on Mr Norris’ strike out application and on the Official Assignee’s opposed application for discovery. I also stayed the proceeding pending the giving of a notice under s 286(2) of the Companies Act and the filing of any amended pleading subsequent to that notice. I also gave a preliminary indication on Mr Norris’ application for costs but invited memoranda if they were not able to be agreed in light of that application. The parties have not been able to agree costs. I have received memoranda from them. I proceed to determine the issue.

[2] As stated in my judgment of 8 May 2012, Mr Norris is a lay litigant, and there are not exceptional circumstances to exercise my discretion to award him costs. However a lay litigant may receive reasonable disbursements in the discretion of the Court. I raised the possibility that payments made by Mr Norris to his employees in

_{assisting Mr Norris in this proceeding might qualify as a disbursement. My}

THE OFFICIAL ASSIGNEE v NORRIS HC NEL CIV 2011-442-000080 [20 July 2012]

preliminary indication was that Mr Norris might receive a contribution to his out-of- pocket expenses in respect of his strike out application and his opposition to the discovery, in an amount equivalent to 2B costs on these two applications. I indicated that this might be a way of measuring his reasonable out-of-pocket expenses.

[3] In providing this indication I was not intending that Mr Norris would receive

2B costs on the two applications and his actual out-of-pocket expenses on the two applications. I was looking for a straightforward way (i.e. one that avoided having to review invoices and determining whether they were (a) reasonable; and (b) relating to the two applications) of providing a contribution to out-of-pocket expenses, which expenses might be said to include payments he has made to his employees in respect of the two applications. That might in turn provide a figure that the two parties were prepared to agree to as a contribution to Mr Norris’ out-of-pocket expenses.

[4] In the event, Mr Norris has made a claim based on his calculation of 2B costs on the two applications and he has also claimed a sum for disbursements. He has done so on the basis that the 2B costs would represent a contribution to the costs of his staff and the sum claimed for disbursements are his other out-of-pocket expenses (for example, filing fees, photocopying and courier expenses). On this basis, he has claimed $4,700 (2B costs in respect of the discovery application), $5,076 (2B costs in respect of the strike out application) and $10,843.87 (for other disbursements) making a total claim of $20,619.87.

[5] The Official Assignee does not submit that no contribution to Mr Norris’ out- of-pocket expenses should be made. He submits that if an award is made on the basis of 2B scale costs then the correct calculation is $3,760 (for the discovery application) and $4,700 (for the strike out application). He submits that there should be no additional amount for disbursements, and that it is not clear that the claimed disbursements relate to the two applications. He submits that, if a contribution to Mr Norris’ out-of-pocket expenses is to be ordered, then this should be offset against a costs order in his favour for Mr Norris’ unsuccessful application for further and better particulars.

[6] On the information before me, it remains difficult to determine what Mr Norris’ out-of-pocket expenses in respect of the two applications were. He has provided information about his staff costs, but these appear to relate to defending the proceedings generally. It is not clear that they relate to assisting Mr Norris with the two applications in respect of which I am prepared to make an order to contribute to his expenses. There is also insufficient detail of the other disbursements claimed to be certain about what they relate to. That said, there would have been application fees paid, some courier and photocopying costs, and transport costs in attending the review hearing in Wellington. As well, the description of the advice provided by MinterEllison indicates that it related to Mr Norris’ strike out application.

[7] If a contribution to out-of-pocket expenses were to be made on the basis of

2B costs it seems to me that neither party has correctly calculated them. That is because all the items appear to relate only up to the hearing by the Associate Judge on the applications and neither party seems to have allowed for the hearing of the review before me. Therefore, if I were to take the Official Assignee’s calculations,

2B costs would be more than $8,460.

[8] I order that the Official Assignee make a contribution to Nr Norris’ out-of- pocket expenses at a sum which I fix at $11,000. This is just over the amount of actual disbursements claimed excluding staff costs. While some of the claimed items may not relate to the two applications, I accept that there would have been some staff costs in assisting Mr Norris with his strike out application, his opposition to the discovery application and the review of the Associate Judge’s decision on those judgments.

[9] I consider that it is not appropriate to reduce the order to take account of the Official Assignee’s success on Mr Norris’ application for further and better particulars. That application was determined against Mr Norris by the Associate Judge. He reserved costs. However it is clear that Mr Norris made the application because of his concerns about the way the Official Assignee had brought the claim and the matters pleaded in that claim. I have effectively upheld those concerns via my decision on the strike out application. Mr Norris would not have needed to make the application for further and better particulars had the proper notice been given on

the claim and had the statement of claim not contained the errors which I found that it had.

[10] Accordingly, I order that the Official Assignee pay Mr Norris’ expenses in

respect of the discovery application and the strike out application in the sum of

$11,000.

Mallon J

Solicitors:

Meredith Connell, Auckland for the Plaintiff

Copy to:

P D Norris ([e-mail])